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The VA loan is hands down the best mortgage loan there is. Here are some reasons why.

Why should you use VA loan

The VA loan is hands down the best mortgage loan there is. Here are some reasons why.

First, VA guarantees the loan for 100% of the appraised value of the property (technically, the loan is for the Notice Of Value amount, which in most cases is the same thing). This guarantee means that the lender is willing to make the loan. The loan amount for 100% financing goes as high as the maximum amount in each county.

Veteran buyers can get a loan for more than the county maximum; they just have to pay 25% of the amount above the county maximum. In pricey California, for example, a veteran could buy a home for $800,000 with a $40,963 down—roughly 5%. Which brings me to the next reason to get a VA loan:

There is no mortgage insurance. A buyer with a 700 credit score will pay about $400 per month for mortgage insurance if he puts 3% down on a conventional loan.

The rates are slightly lower in some cases. Also, underwriting standards are easier. Where conventional loans use dent-to-income ratios to qualify, VA loans use “residual income.” This looks at how much money they actually have available each month after meeting normal expenses from their take-home pay. Conventional loans are typically capped at a 45% debt ratio (or thereabouts). VA loans can many times be approved above 50% depending on the overall strength of the borrower.

When rates drop, refinancing is easy. VA loans offer a “streamline” refinance option, called an Interest Rate Reduction Refinance Loan (IRRRL). This allows the veteran borrower to reduce his or her rate with no appraisal, and very little underwriting of income. The primary criterion for approval is that the borrower has an acceptable payment history and that they are improving their position.

If a veteran wants to refinance and get cash out of his or her equity, there is no pricing adjustment for that process. A conventional loan will typically be about .25% higher in rate to get cash out.

For anyone who is a qualifying veteran, NOT getting a VA loan would be a costly mistake.

Hope this helps!



First time homebuyer gut checks

First time homebuyer gut checks

Many first-time homebuyers have stars in their eyes when they first begun house-hunting. Their ideal is a house that is move-in-ready, offers the number of bedrooms/baths/square footage they’re looking for, is in a great neighborhood and, of course, is within their budget. Matching all that criteria is often a tall order, especially the move-in-ready aspect of it. Buying a first home can be a scary, sobering experience, but if a buyer’s eyes are wide open and their expectations are realistic, they’ll be able to throw down that welcome mat in front of their very own front door.

The realistic part is not fun, but there are number of things first-time homebuyers worry about that really don’t matter as well as things easily changed before or after move-in.

The big (potentially bad) facts when considering your first home:

  • A north-facing house will always be dark unless you add a ton of skylights.
  • A house on a busy intersection will always be noisy and most corner lots will always have neighbors zipping by.
  • A traditional style exterior will likely never look Manhattan-industrial chic and a contemporary one will never smack of the Hamptons.
  • The next-door neighbor who uses his front yard as a car repair shop isn’t likely to change careers anytime soon.
  • Homeowner fees rarely get reduced and often get jacked up over the years
  • Supplemental taxes (extra ones added to your normal property taxes for infrastructure care) can last up to 25 or more years.
  • Strict neighborhood restrictions (covenants, codes and restrictions) may preclude you from parking cars on the driveway or running a business out of your house.
  • The commute to work will never get shorter and may, in fact, get longer.
  • Schools, shopping, and freeways/interstates may never get closer than they already are.
  • Barking dogs may not last forever, but they do have lifespans capable of robbing you of years of precious sleep.
  • Changing the location of the laundry room or a set of stairs is no walk in the park.
  • Some of the most important necessary improvements are not the sexiest: things like more attic insulation, new windows, a new roof, scraping Mount Everest texturing off the ceilings, replacing or upgrading electrical or plumbing, but they often have the best return on investment
  • Older homes have secrets hidden behind walls that are not necessarily caught during a physical inspection.

Small stuff not to sweat:

Furniture that doesn’t fit. Just because the IKEA table you painstakingly put together is a heartthrob piece to you, it’s not worth rejecting a house over. On the other hand, buying a house for that huge four-poster bed your grandparents made babies in might make you look for a house with a huge master, which in turn, may find you compromising on other things you want in the house. Remember that furniture that doesn’t work in your new home can be sold on Craigslist, given to a charity thrift store, consigned, or handed down to a relative.

Paint, wallpaper, paneling and dated built-ins. Remember this house started out as a shell, and everything you see on the interior was lovingly added by someone according to their own idea of heaven. Just because the inside looks like 1965 doesn’t mean it has to stay that way. Some of the least expensive DIY projects you can do are demolishing cosmetic items, such as removing non-load-bearing walls (get an engineer to help you make sure it’s not otherwise), changing out light fixtures, replacing ugly paint colors, and smoothing out cottage cheese ceilings (with masks on, of course — check to make sure they’re not asbestos-laden before taking this on).

Don’t let yourself be bothered by the seller’s furniture and hot messes, or how they’ve used the dining room for a kids’ playroom or a messy office. Well-worn recliners and dusty drapes are nothing compared to the prospect of remodeling a kitchen or a bathroom. Before you buy, you can get some quotes on how much it will cost to remodel the kitchen and the bathrooms that look like scenes out the movie Pleasantville. Those are the rooms where updating will cost you.

Become the savvy first-timer

According to Remodeling’s annual study, putting loose-fill insulation in the attic can bring a 107.7% return on investment, while siding replacement recouped 92.8 percent of its cost. We know. Improvements like those are about as exciting as watching grass grow, but they’re among the wisest improvements to make upon move-in.

Be sure to examine what the inspection you ordered up tells you about how the house has been maintained and do some research on the neighborhood as well. No one can stop you from door-knocking and asking the neighbors a few questions. Infrastructure matters –not just the structure itself, but these days connectivity services available in the neighborhood are important. New roofs, new plumbing and new electrical systems will likely serve you better than a recently remodeled kitchen.

First-time homebuyers are often guilty of seeing things only as they are, instead of seeing what they could be. As we said, do your research. Visit the local city hall to see what the future of the neighborhood might be. Ask about those abandoned railroad tracks and the bottom of the hill and find out whether those are apartments being built behind the backyard. Call the local school district to see what schools your kids may be attending even if there are some obvious ones close by. Surprises after move-in are not fun, but many can be avoided with a bit of due diligence. And above all, force your eye to view the potential, not the paneled walls, disco mirrors or flocked wallpaper.

Source: TBWS



More Homeowners Mean Fewer Renters

According to the National Association of Realtors, rising wages, loosening credit standards and demographic shifts are combining to create momentum for owning a home rather than renting one.

With the homeownership rate rising for the fifth consecutive quarter, it held steady at 64.2%, unchanged from the prior quarter and its highest level since 2014. The share of Americans who own a home rose from the prior year, from 63.6% in the first quarter of 2017.

See the full story here:





Pet Friendly Ideas For Your Home

Even if a friendly tail wag did not greet you at the front door, it can be evident that a pet lives there when you walk into someone’s home. It could be the smell of pet odor. Or maybe it’s those telltale tufts of shedded hair swirling in the air as the front door shuts. Today’s homeowners, however, are actually designing and redecorating living spaces with their pets’ needs in mind, turning pet-friendly decorating into a full-blown trend.

See complete story here:



Rising Tides In Real Estate Value

There are time-worn real estate adages that never seem to go away. “Location, location, location” is one of them, and it still applies. But what about the one used in every “fix-and-flip,” or “fix-and-occupy” program on HGTV about buying the worst home in the best neighborhood?

For all those experts who push buying the most run-down place in the best part of town as a surefire winning investment because the only way its value can go is up, it may be time to take a second look, according to by Spencer Rascoff and Stan Humphries’ book Zillow Talk: The New Rules of Real Estate.

Here’s the complete story:





Trading in stocks still rules: yesterday the DJIA traded in a 382 range, trading up 228 then sliding to down 10 before closing essentially unchanged. The bond and mortgage markets yesterday didn’t bite on the volatility and generally were unchanged from Friday’s close. This morning, pre-opening trade at 8:00 AM ET, the DJIA up 150 points and the other indexes also better. This morning the 10 yr. note yield started at 2.57% +3 bps from yesterday and MBS prices at 8:00 -11 bps from yesterday’s close.



Pending Home Sales Edge Higher

Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market. This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events. When MBS pricing goes up, mortgage rates or pricing generally goes down. When they fall, mortgage pricing goes up.

Full Story Click Here:


Samsung aims to control your connected home

Samsung recently released the Family Hub Smart Fridge 2.0 with WIFI and touchscreen panel. This fridge does a lot more than just keep your food cold. Samsung’s upgraded fridge introduced voice activation, TV mirroring, and WIFI.

The “Family Connection” piece allows the sharing of calendars, photos, and notes.The fridge can act as a TV and stream music.

Click HERE for the full article. This is interesting.




ADP at 8:15 AM EST this morning; another huge increase against forecasts, +263K (170K expected). ADP said its count was an increase of 263K in March, Feb revised lower from 298K to 245K -53K. The initial market reaction was a little selling in treasuries and MBSs but not what you would suspect; at 8:45 FNMA 3.5 coupon -5 bp, the 10 yr at 8:45 up just 1 bp to 2.37%. Friday, of course, is the BLS March employment data. ADP data has been a little better than BLS numbers in Jan and Feb (ADP +11K better in Jan, ADP +18K better than BLS). A couple of highlights in ADP data construction jobs and manufacturing jobs: construction industry 49,000 jobs, manufacturing sector added 30,000 positions. Professional and business sectors added 57,000 jobs and leisure and hospitality added 55,000. Prior to this data, the forecasts for non-farm private jobs from BLS on Friday were an increase of 170K, now that will be revised higher in market thinking.


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